Just been offered to go perm Just been offered to go perm - Page 3
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  1. #21

    Some things in Moderation

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    With that I would go permie and immediately put the company into MVL.

    Close it down ASAP.

    Then watch while the world burns...

  2. #22

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    Quote Originally Posted by northernladuk View Post
    Standard thing is to pay Ipse for another full tax year after closing just to cover any investigation. Could do 2 if you are risk averse.
    I know people say that, but one wonders if it has ever been needed or if it is just a nice little money spinner for IPSE....

  3. #23

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    Quote Originally Posted by WordIsBond View Post
    I know people say that, but one wonders if it has ever been needed or if it is just a nice little money spinner for IPSE....
    Then get the equivalent from qdos or another provider instead.

    The point about insurance is that's it's 'just in case'. No-one knows if it's needed so it's all about your attitude to risk.

  4. #24

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    I suppose. I'd be of the view that if you've had contract reviews that the risk, once your company is closed, is nil. The risk of HMRC chasing a closed company for IR35 is virtually nil -- it's never happened. The risk of them ever being able to pierce the corporate veil is close to nil because IR35 is so nebulous. The risk of them doing so if you've had contract reviews and so can demonstrate that you 'were responsible' is so vanishingly small that I personally would never bother to insure against it.

    But to each his own. Admittedly it isn't expensive.

  5. #25

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    Quote Originally Posted by WordIsBond View Post
    If you get the company closed you probably won't need it, especially if you used them for contract reviews.

    The risk is HMRC starting an investigation of you before it is closed and not letting you close it.
    My provider states l have to maintain investigation insurance for up to two years after closing.

  6. #26

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    Quote Originally Posted by Hobosapien View Post
    A factor that would determine how I handled such a scenario is how much money is sat in your Ltd's bank account as profit. That would be the basis of how to go about closing the Ltd (MVL if over £25k) and also what risk exposure there is to IR35 as any tax liability comes out of what the Ltd can pay.
    So you are saying the amount of tax you pay if your investigated for ir35 and lose is limited to what’s in your companies bank?

  7. #27

    Fingers like lightning

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    Quote Originally Posted by dx4100 View Post
    So you are saying the amount of tax you pay if your investigated for ir35 and lose is limited to what’s in your companies bank?
    The amount in you Ltd determines whether closure via MVL is appropriate. HMRC will take everything including your house if that’s what you owe...
    "why ride a vespa when you can push a lambretta?"

    As I look ahead, I am filled with foreboding; like the Roman, I seem to see "the River Tiber foaming with much blood."

  8. #28

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    Income tax is a personal liability, not a Ltd Co one, IIRC.

  9. #29

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    Quote Originally Posted by dx4100 View Post
    So you are saying the amount of tax you pay if your investigated for ir35 and lose is limited to what’s in your companies bank?
    It depends. Limited liability protection is unlikely to be transferred to personal liability if due diligence on IR35 assessment to operate outside of it can be shown to be done. i.e. if you have contracts reviewed and have a written determination by a reputable third party then that shows you operated in good faith and it would take exceptional circumstances for HMRC to chase you personally for tax liabilities that fall under the PAYE system of the Ltd, so if the funds in the Ltd don't cover the liability then HMRC may win an investigation but not be able to collect the full amount they now say is due.

    The issue with 'it depends' is the potential for a lot of drawn out hassle and stress while an investigation is ongoing, so the approach of getting contracts reviewed and backed up with insurance is a good way of trying to cover that as best you can.

    Google 'IR35 and personal liability' for more information from accountants and those that have dealt with this scenario for real clients (contractors), that is the basis of my understanding of how this may apply.

    Edit: May as well start with CUK's own info on this:Contractors, don't get lumbered with your limited company's tax bill
    Last edited by Hobosapien; 13th October 2019 at 09:55.
    Maybe tomorrow, I'll want to settle down. Until tomorrow, I'll just keep moving on.

  10. #30

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    Quote Originally Posted by dx4100 View Post
    My provider states l have to maintain investigation insurance for up to two years after closing.
    Your insurance provider? Your MVL provider? What provider?

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